Gold struggles below $1,200

SINGAPORE, Dec 22 (Reuters): Gold was stuck below $1,200 an ounce on Monday, struggling to get past last week's losses, hurt by a stronger dollar and equities which dulled the metal's safe-haven appeal, and expectations of higher U.S. interest rates.

Spot gold was little changed at $1,194.95 an ounce by 0023 GMT, after losing about 2 per cent last week on worries over a US interest rate hike next year.

The Federal Reserve, after wrapping up a two-day meeting last Wednesday, signalled it was on track to increase rates next year but said it was taking a patient stance, keeping gold's losses in check. Higher interest rates would hurt non-interest-bearing bullion, which was boosted by central bank liquidity and a low interest rate environment in the years following the 2008 financial crisis.

Also weighing on gold was the strength in equities. Asian shares and the dollar began a holiday-shortened week on a strong footing on Monday, with the euro testing two-year lows against the greenback.

More recent data about clues on investor positioning shows that holdings in SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose 0.41 per cent to 724.55 tonnes on Friday.